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Mr X and the National Asset Management Agency

Case Number: 170288

Whether NAMA was justified in refusing access to records concerning the disposal of a certain portfolio of properties (the portfolio) "held by" Company A (a subsidiary of Company B) and the shareholding of Company B in Company A, and the repayment, waiver or discharge of a related credit facility and security interests held

Conducted in accordance with section 22(2) of the FOI Act by Elizabeth Dolan, Senior Investigator, who is authorised by the Information Commissioner to conduct this review

Background

The applicant's FOI request to NAMA, dated 1 February 2017, was in two parts. It is quite detailed and I see no need to repeat it in full. In summary, part 1 sought records concerning the disposal of a certain foreign portfolio of properties (the portfolio) "held by" Company A, which the request said was a subsidiary of Company B. Part 1 also sought records concerning the disposal of the shareholding of Company B in Company A. Part 2 sought records concerning the repayment, waiver or discharge of a related credit facility and security interests held. The applicant's company was an unsuccessful underbidder for the portfolio.

On 28 February 2017, NAMA refused to grant access to the requested records. It said that certain records were not subject to the FOI Act further to Schedule 1, Part 1(x)(iii) of the Act. It said that other records were subject to FOI but were exempt under section 41(1)(a) of the FOI Act, which provides for the refusal of a record where its disclosure is prohibited by an enactment. The applicant sought an internal review on 28 March 2017, which NAMA affirmed on 26 April 2017.

On 6 June 2017, the applicant sought a review by this Office of NAMA's decision.

I have now decided to conclude my review by way of binding decision. In carrying out my review, I have had regard to the above; to correspondence between this Office, NAMA and the applicant; and to copies of the records at issue, which were provided to this Office for the purposes of this review. I have had regard also to the provisions of the FOI Act. Although invited to, the applicant did not make a submission to this Office.

Scope of the Review

This review is confined to whether or not NAMA has justified its refusal of access to the records it identified as relevant to the request. NAMA's treatment of the applicant's earlier, connected request cannot be taken into account.

Findings

Records Fully Covered By Schedule 1, Part 1(x)(iii)
Section 6 of the FOI Act sets out what "shall be a public body" for the purposes of the FOI Act. Schedule 1, Part 1(x)(iii) provides that section 6 does not include a reference to NAMA "insofar as it relates to records concerning purchasers or potential purchasers of any asset or loan or of any other asset securing loans held or managed by" NAMA. The provision is not subject to any consideration of the public interest or any exceptions.

In his internal review application, the applicant says he accepted that records that have asset purchasers as their principal focus were excluded from the FOI Act further to Schedule 1, Part 1(x)(iii) of the Act. However, he did not accept that records that merely mention purchasers in a peripheral sense were covered by Schedule 1, Part 1(x)(iii). In this regard, he said he would not object to any peripheral details about purchasers being redacted.

The applicant's views are in keeping with the decision I subsequently issued in Case No 160253 (Mr Mark Tighe of the Sunday Times on www.oic.ie), which concerned records relating to NAMA's Project Eagle bidding process. I found that the expression "relates to records concerning" should be given its ordinary meaning. It seems to me that Schedule 1, Part 1(x)(iii) is directed at records regarding, or about, third parties that are not FOI bodies or state agencies.

NAMA's original and internal review decisions in this case were made before my decision on Case No 160253 issued. It revised its view on the application of Schedule 1, Part 1(x)(iii) during this review and identified a number of the records as being entirely covered by Schedule 1, Part 1(x)(iii).

I have no remit to consider directing release of information that is not subject to the FOI Act in the first place. The fact that NAMA's submission to this Office identifies only certain of the records as fully covered by Schedule 1 Part 1(x)(iii) does not mean that I cannot consider whether other records are also covered. Having examined the remaining records, it seems to me that certain other records considered by NAMA to be subject to FOI but exempt under section 41 actually concern purchasers or potential purchasers of any asset or loan or of any other asset securing loans held or managed by NAMA.

In spite of his apparent acceptance at internal review stage that records with asset purchasers as their principal focus are not subject to FOI, the applicant's correspondence with this Office argues that the requested records "concern such categories of persons or entities in a peripheral way only and do not have asset purchasers as their dominant or principal focus to such an extent as to bring them within the scope of Schedule 1, Part 1(x)(iii)." However, with the exception of elements of a small number of them, I consider the above records to be entirely covered by Schedule 1, Part 1(x)(iii) of the FOI Act. I find them not to be subject to the FOI Act and I affirm NAMA's refusal to grant access to them.

Some elements of a small number of the above mentioned records can be said to relate more to the portfolio's sales process or to the relevant debtor, than they do to the portfolio's purchaser or potential purchasers. However, given my findings below on section 41(1)(a) in relation to the details concerned, I see no reason to identify the relevant material further.

Excerpts of Records Subject to FOI That Are Covered by Schedule 1, Part 1(x)(iii)
I consider that the remaining records do not primarily concern purchasers or potential purchasers of any asset or loan or of any other asset securing loans held or managed by NAMA. They are therefore not covered by Schedule 1, Part 1(x)(iii), and are subject to the Act.

However, some of them also contain brief references to the purchaser or potential purchasers of the portfolio. I accept that those specific excerpts are covered by Schedule 1, Part 1(x)(iii) and are not subject to the FOI Act. Again, given my decision below on section 41(1)(a) in relation to the remainder of these records, I see no reason to identify the relevant material in any more detail.

Records Subject to FOI - Section 41
In its original and internal review decisions, NAMA refused access to those records it considered to be subject to FOI under section 41(1)(a) of the FOI Act, in which regard it referred to sections 99 and 202 of the NAMA Act 2009 (the NAMA Act).

Section 41(1)(a) of the FOI Act is a mandatory provision that applies where the disclosure of a record is prohibited by an enactment not specified in the Third Schedule to the FOI Act. Section 41(1)(a) is not itself subject to a public interest override.

The Information Commissioner considered similar claims made by NAMA in his decision on Case No 150247(on www.oic.ie). He said he understood section 99 of the NAMA Act to provide for NAMA to exercise the rights, powers and obligations of the participating institution from which the bank asset was acquired in relation to those entities set out in section 99(1)(a)(i)-(iv) of the NAMA Act. He noted that section 99 of the NAMA Act imposes on NAMA all of the obligations owed by the participating institution to the debtor concerned, including the duty of confidentiality.

The Commissioner accepted that the provisions of section 99 of the NAMA Act are such as to engage section 41(1)(a) of the FOI Act. He went on to find that section 99 of the NAMA Act and section 41(1)(a) applied to records concerning a debtor of NAMA, including communications between NAMA and the debtor regarding his planning permission application (i.e. records that were in the public domain).

NAMA considers those records that are not covered by Schedule 1, Part 1(x)(iii) to contain information that is subject to section 99 of the NAMA Act and, in turn, exempt under section 41(1)(a).

I have considered the relevant records, as well as two further records that NAMA does not appear to consider to be covered by section 41(1)(a), but which it considers to be exempt under other provisions of the Act that I need not consider in the circumstances. I accept that they are mainly communications between NAMA and the relevant debtor in relation to the bank asset. Some further records are internal NAMA communications directly related to those communications. I consider these records to be of a sort that would be covered by the normal banker-client duty of confidentiality.

All such records are, in my view, records to which section 99 of the NAMA Act applies, as are those elements of the small number of records that I described earlier in this decision as relating to the portfolio's sales process and the relevant debtor.

The applicant appears to accept that there exists a banker's common law duty of confidentiality. However, he argues that information subject to this duty could be released in two situations: (i) where the terms of the contract between the banker and debtor permit such disclosure; and (ii) where such disclosure is in the public interest. He also referred to the requirement on NAMA, further to section 11(6) of the NAMA Act 2009, to act in a transparent manner in carrying out its functions under the Act.

NAMA says that the relevant arrangements with the debtor do not contain any terms that permit the disclosure of confidential information. I have no reason to dispute this.

It also says that section 41(1)(a) is not subject to consideration of the public interest. While NAMA is correct in its description of section 41(1)(a), it is also the case that the Courts have found that a breach of a duty of confidence (such as the banker-client duty covered by section 99 of the NAMA Act) can be authorised, or excused, on public interest grounds. However, such grounds are narrow. They include the exposure or avoidance of wrongdoing or danger to the public, and ensuring the maintenance of the principles of justice. I do not consider these grounds to have any relevance to the records at issue.

I am also aware that Fennelly J. noted, in obiter remarks in Mahon v. Post Publications[2007] IESC 15, that certain UK cases had established that "the government was not in a position to complain of breach of its secrets and publication of confidential information on the same basis as private individuals" and that government agencies "must prove detriment to the public interest". However, the material at issue here is not solely "government" (NAMA) information. The details at issue are, in my view, as much information about the relevant debtor as they are "government information". There is no need for me, therefore, to consider whether NAMA must prove, or has proven, detriment to the public interest in this case.

Binchy J., in the case of O'Brien v Radió Telefis Éireann [2015] IEHC 397, found that a duty of confidence between a bank and its customers "may give way to issues of very significant public importance, and not just in cases where wrongdoing is involved." He said, however, it seemed to him that there must be "some meaningful connection between the issue of public importance that has been identified, and firstly, those whose rights may be breached and, secondly, the information and documentation under consideration." While recognising "the public interest in the affairs of IBRC", he said that that "of itself does not entitle the public to know every detail of the affairs or operation of IBRC, and certainly not confidential information concerning its customers." He said that the public interest was "in knowing that it is properly governed and operated, and where there are any significant shortcomings in this regard, and in particular where such shortcomings may lead to significant losses, which have to be borne at the expense of the public purse, in [his] view the public is entitled to be informed of such matters."

It is reasonable to accept that NAMA's workings can be categorised as a meaningful issue of public importance. I have no remit to consider, or make findings on any FOI body's performance of its functions. I do accept, however, that release of records containing information about such matters would enable the general public to draw its own conclusions on this question.

Equally, though, it is clear from Binchy J.'s comments that not "every detail of the affairs or operation" of NAMA must be released under FOI, "and certainly not confidential information concerning its customers". It is also relevant that the release of a record under the FOI Act is understood, effectively, to be equivalent to its release to the world at large, as opposed, say, to furnishing it to a party to litigation under discovery procedures.

As set out above, the requested records primarily concern the confidential banking relationship between a debtor and NAMA and contain confidential information about that debtor. I see no basis on which to find that the duty of confidence owed by NAMA to the debtor may be excused or authorised in this case, having considered the public interest defence. I find them to be covered by section 99 of the NAMA Act and, accordingly, exempt from release under section 41(1)(a) of the FOI Act.

Decision

Having carried out a review under section 22(2) of the FOI Act, I hereby affirm NAMA's refusal to grant the applicant's request, further to Schedule 1, Part(x)(iii) and section 41(1)(a) of the FOI Act.

Right of Appeal

Section 24 of the FOI Act sets out detailed provisions for an appeal to the High Court by a party to a review, or any other person affected by the decision. In summary, such an appeal, normally on a point of law, must be initiated not later than four weeks after notice of the decision was given to the person bringing the appeal.


Elizabeth Dolan
Senior Investigator